We talked again about interest, pooling and not getting into credit card debit.
credit card companys love college students cause we don't have a lot of money.
lowing interest rates encourages people to buy more things. and borrow money. buying things are good for buying things by businesses making money. Then the business multiplies then that means hiring more workers. increase interest rates means stock prices would go down. they thought stock market was getting low so they raised interest rates. it was booming in the 20s by borrowing money.
This is a tough topic. so we have to work really hard to understand.
buy low sell high on stocks. that's what its all about!
What are the causes of the Great Depression?
--Main Reasons:
Stock market crash
Bank failures
Reduction in purchasing across the board
American economic policy with Europe
Drought conditions
~Stock MArket crash. many people invested all their money in the stock market
lost more then 40 billion dollars all though the stock market gained back some stocks it just wasn't enough.
~Bank Failures
over 9,000 banks failed. lots of people lost their savings. Banks that survived had no idea if they were going to survive for sure now.
~Purchasing across the board
wberone stopped buying items because they feared that more economical problems would occur.
this led to a reducton in numbers of items made and reduced the workforce. K
~Economic Policy with Europe
Business began falling
Government created the smoot-hawley tariff. Smoot-hawley tariff= to protect american companies in 1930. it charged a high tax for imports
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